Apple’s iTV HDTV will fail to alter traditional TV business model

Apple’s ‘iTV’ HDTV will look like a large iPad, supporting iOS apps and games, but will ultimately fail to change TV business model

Apple’s ‘iTV’ HDTV will look like a large iPad, supporting iOS apps and games, but will ultimately fail to change the traditional TV business model, according to Barclays analyst Anthony DiClemente.

Speaking to AllThingsD, DiClemente said that he also doesn’t expect Apple to launch its TV set in 2012. The TV set will connect to the web, feature a built-in iTunes client for downloading and streaming content as well as AirPlay-support.

Yet despite all of the above, DiClemente does not think Apple has enough to change the traditional TV business model.

It added: ‘the “affiliate fees” that cable providers pay for the bundles are now up to $30 billion a year, or about $30 per subscriber per month. And programmers aren’t going to do anything that weakens that revenue stream.’

On a more positive note, the analyst does believe that the TV set will feature some decent hardware, Apple’s Siri assistant, which will presumably be used for choosing programmes and changing channels, as well as a ‘groundbreaking interface.’

Will this be enough though? In a world of Sky, Cable TV and huge TV corporations like Comcast in the US we don’t think so. Sure there’s a definite move away from traditional TV distribution models taking place at the moment with the rise of LoveFilm and NetFlix but these services are still a long way from becoming 'the norm.'

Thing is: Apple TV already does much of this – and for a much smaller price tag as well. So the big question is how can Apple make its TV a unique and compelling proposition (besides just bundling Siri inside it)?